Uncovering Budget

1Why this session is company-wide

This is your copy to keep. The gold Going deeper boxes go past what the session covers, for anyone who wants the fuller picture.

Money comes up on everyone here, not just the two seats that carry a pipeline. A technician on site gets asked what a replacement switch would run. A coordinator gets asked on the phone what a project costs. You are not expected to name a price in those moments. You are expected to find out what the client has in mind and where it would come from, and write it down, so the person who does name the price is not guessing.

This session assumes sessions 01 to 05: the seven steps of the system, how people decide whether to trust you, the agreement made at the start of a conversation about what it is for and what happens at the end, and the questions that establish what a problem is costing a client. This is step four of those seven, and it sits directly after that last piece of work for a reason you will see in section 2.

The method here comes from the Sandler Foundations course. The examples, the figures and everything about how it applies here are ours. The chapter PDFs are in the reference folder of this program if you want the source.

2Why budget comes after pain

Ask a prospect about money ten minutes into a first meeting and you get one of two answers. "That depends on what you are proposing", or a figure so low it is obviously a shield. Neither is a lie. Both are correct answers to the question you actually asked, which was what a stranger will pay for a thing nobody has described yet.

Ask after the client has spent twenty minutes telling you about four outages last quarter, an insurance questionnaire they cannot answer, and an office manager who loses a day a week to IT, and it is a different question. It is now about funding something they have just said they want fixed.

The rule is the sequence. The budget step opens by summarizing the pain back to the client and getting their agreement to talk about money. Pain, in this method, is the specific thing the problem is costing them and their reason to do something about it, which is what sessions 04 and 05 were about. Until that is established and said back to them, there is nothing for a number to attach to.

The obvious objection is that asking about money feels rude. It is far ruder to spend two weeks of their time and ours scoping, assessing and writing a proposal for something they were never able to buy.

3Willing and able to invest three things

A client has to be willing and able to invest money, time and resources. Willing and able are two separate tests, and an engagement can fail either one. The owner who wants it and cannot fund it and the owner who can fund it and will not free anyone up end in the same place.

The two that get skipped are the two that are not money, and they are why a signed agreement can still turn into a bad engagement. An onboarding runs on their people as much as on ours. We cannot document what nobody tells us and we cannot secure what we are not given access to.

Model example, figures for illustration only. If a documentation and stabilization phase needs their office manager for four hours a week across six weeks, that is 4 multiplied by 6, which is 24 hours of one person's time. That is a real ask. It belongs in the budget conversation, alongside the money, rather than turning up as a surprise at the kickoff meeting.

4The two roadblocks

There are two reasons this step does not get done, and they need different fixes.

The conceptual one is the bigger of the two. A person who would never spend that much of their own money cannot ask a client for it without something showing in their voice. It comes out as apologizing for the number before the client has reacted, softening it, offering a cheaper option nobody asked for, or changing the subject as soon as money comes up.

Here is the tell. You hear yourself say "I know that's a lot" and the client has not said a word yet. That sentence came from you, and the answer you just gave them was your household budget, not their operating one. It is not your money and it is not your business. A figure that would be a serious decision at home is an ordinary annual line for a practice with forty staff. What it is for them is something you find out by asking and then being quiet.

5The three steps of the budget conversation

Three steps, in order. Each one ends before the next one starts.

Step one is a sentence and a question. "You told me the outages cost you a full morning each time and that the insurance questionnaire is due in March. Have I got that right? Can we talk about what it would take to fund solving it?" If they will not agree to talk about money, you have learned that in one minute instead of two weeks.

Step two asks whether and where, and where matters as much as whether. An operating line that already exists behaves differently from a capital purchase that needs a board vote, and both behave differently from money that does not exist yet. Two phrasings that work:

• Direct: "Have you put a number aside for this yet?"
• Leaving them room: "When we work with a practice this size, there is usually an IT line in the budget already. I do not know whether that is true here."

Step three asks how much, and it has its own section, because it is where most people either demand a figure or flinch.

6Yes, no and maybe

Step two gets one of three answers.

The put-offs sound like the best answer here and are the weakest. No number has been named, no source of funds identified, nothing agreed. A client who has genuinely cleared the money can tell you where it sits. "Money is no object" usually means the question has not been thought about yet, and taking it as a yes is how a proposal ends up in front of somebody it surprises.

7Asking how much without demanding a figure

Two tools, and a follow-up question that is more useful than either.

A round number. Put a deliberately round figure in the air and let them correct it. "Are we talking about something in the region of fifty thousand for the first year?" The fifty thousand there belongs to the model example below and is for illustration only. People who will not volunteer a number will happily tell you a number is wrong.

Bracketing. Name a range and ask where in it they sit, or whether they are above it or below it. Nobody has to disclose a figure to answer that, which is why it survives a stall.

Model example, figures for illustration only. A practice with forty users at a model rate of 125 dollars per user per month is 40 multiplied by 125, which is 5,000 dollars a month. Across twelve months that is 5,000 multiplied by 12, which is 60,000 dollars. Add a one-time onboarding project at a model 10,000 dollars and the first year is 60,000 plus 10,000, which is 70,000 dollars. The bracket you would put in the air is that organizations of this size land somewhere between 40,000 and 90,000 in a first year, and you ask where in that they are.

The follow-up question. Whatever figure you get, ask: what if that is not enough, where would the rest come from. A client who names 45,000 and can point at next year's capital line has told you something. One who names 45,000 and has no answer has told you something else, and it is better to know now.

8The monkey's paw

Sometimes a client is willing and able, and not all at once. Instead of an all-or-nothing number, split the engagement into two phases, which are two separate sales. This is called a monkey's paw, after the light weighted line a ship's crew throws to the dock so the dockhands can haul the heavy mooring rope across with it.

Using the model figures from section 7: a first year of 70,000 dollars against 45,000 available is 70,000 minus 45,000, which is a gap of 25,000. Phase one at a model 10,000 dollars leaves 45,000 minus 10,000, which is 35,000. At 5,000 dollars a month that is 35,000 divided by 5,000, which is seven months of the agreement inside this budget year, with the remaining five months falling into their next one.

This is not a discount. The price of the work did not change and no hour is billed at less than it is worth. A discount lowers the price of the same scope, and it teaches a client that our number is a starting position. A monkey's paw changes what is bought first and when the rest is bought, on a schedule their budget actually supports.

The part that makes it work, and the part that gets left out: the agreement about phase two is written down before phase one starts, and it names the results that trigger it. "When the inventory is complete, every endpoint is reporting and the remediation list is priced, the agreement begins on the first of the following month." Without that in writing, phase one is just a small project, and the most likely outcome is a client with good documentation and no provider.

9Practice on a live opportunity

1. Pick one opportunity or client conversation you are in the middle of. If you do not carry a pipeline, use a client who has asked you what something would cost.
2. Write the pain summary. Two sentences, in the client's own words, from what you actually know, ending in "have I got that right".
3. Write the exact words of your step two question. Whether money is available, and where it would come from. Write the words you will say, not a description of them.
4. Write the bracket you would put in the air, and the round number you would use instead if the bracket gets a stall.
5. Write the follow-up: what if that is not enough, where would the rest come from.
6. Write what you will need from their people in time and resources, as hours and as named roles.
7. If the money is short, write a one-line phase one and the result that would trigger phase two.
8. Put the money answer, the source, and the time and resources answers into the Nutshell lead record, or mark them unknown.

10Check for understanding

1. A prospect says "money is no object, we will spend whatever it takes". Is that a yes, a no or a maybe, and what do you ask next?

2. A client signs a managed services agreement and the onboarding stalls for two months. The invoices were paid on time. Which of the three investments was missing, and what question in the budget step would have found it?

3. You ask about budget ten minutes into a first meeting and get "that depends on what you are proposing". What went wrong in the sequence, and what has to happen before you ask again?

4. A prospect says "I cannot tell you that, it is company policy". What kind of answer is that, and what are two ways to keep the conversation moving without asking for the figure again?

5. Using the model figures from this session, a first year comes to 70,000 dollars and the client has 45,000 available. Explain how a monkey's paw differs from taking 25,000 dollars off the price, and what has to be written down before phase one begins.

6. Why is your own opinion about what counts as expensive a problem in this step, and what does it look like when it shows up in a meeting?

11Before the next session

• Do the practice steps in section 9 and bring the pain summary, the question in your own words, and the bracket you would use.
• Fill in the Nutshell record for that opportunity with the money, time and resources answers, or with unknown where you do not have them.
• Optional. Chapter 6 of the Sandler Foundations workbook in the reference folder.

Next session. 07 - The Decision Process. Who actually decides, what they decide against, what else they are looking at, and how to get the process agreed in advance so a decision does not come apart in a room we are not in.

12Glossary

Budget step

Step four of the seven. Establishing whether a client is willing and able to invest what solving their problem takes.

Willing and able

Two separate tests. Wanting to invest, and being in a position to.

Money, time and resources

The three things a client has to invest. Money is the fee, time is their calendar, resources are their people and the access they hold.

Technical roadblock

Not knowing which budget question to ask, how to phrase it, or when.

Conceptual roadblock

Your own beliefs about money changing how you ask, usually by softening or apologizing before the client reacts.

Stall

A defensive maybe. "I cannot tell you that." Not a final answer.

Put-off

A deflecting maybe that sounds encouraging. "Money is no object." No figure and no commitment.

Bracketing

Naming a range and asking where in it the client sits, so they can answer without disclosing a figure.

Round number

Putting a deliberately round figure in the air for the client to correct.

Monkey's paw

Splitting an engagement into a small phase one and a phase two, with a written agreement before phase one about what results trigger phase two.

Pain

The specific thing a problem is costing a client and their reason to act on it. Covered in sessions 04 and 05.

BTR

Business technology review. The recurring account meeting we hold with a client.

13Sources

• Sandler Systems, Sandler Foundations, chapter 6, Uncovering the Prospect's Budget: chapter PDF.
• Sandler Systems, Sandler Foundations: full workbook PDF.

The budget step, the three investments, the technical and conceptual roadblocks, the stall and put-off answers, bracketing and the term monkey's paw are Sandler's. The model figures, the phase one and phase two shape, and everything about how this applies at Hermetic are ours.